AIB announces 'slow reduction' in number of customers in mortgage arrears

Around 38,000 AIB customers are in arrears on their mortgages, down from a peak of 50,000.

This morning the bank has announced it is reducing its owner occupier mortgage interest rates by 0.25% from October 1.

It is the third cut in 10 months and its standard variable interest rate now stands at 3.65%.

AIB's Chief Executive, Bernard Byrne, says arrears are down but there is still a large section of those customers who are not making payments on their loans.

He said: "We've come from a peak of around 50,000 customers in arrears down to 38,000 at this stage.

"The number of customers in a long-term position, people who have been in arrears for two years or 720 days, is around 9,000.

"So that number has been reducing, but it's reducing slowly. Approximately 40% of those customers haven't been able to make any payment at all in the last 12 months, so that is a difficult cohort of customers."